Compounding interest question
2 Replies
Steven Moore
from Charlotte, NC
posted 7 months ago
I hear a lot of talk about compounding interest on rental properties. I’m curious of how everyone out there does this and what methods they find to be best?
Wayne Brooks
Real Estate Professional from West Palm Beach, Florida
replied 7 months ago
The two are not really related.....compounding is when interest is not paid or collected so the interest gets added to the balance so you start earning “interest on the interest” as well as the principal balance. Some people confuse a mortgage loan with “compound” or “amortized “ (no such thing) interest.
Chris Seveney
Investor from Northern Virginia
replied 7 months ago
@Steven Moore not sure what they are talking about. Compounding interest is interest earned reinvested and it is earning interest